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Association Comments on CY 2021 OPPS, PFS Proposed Rules

In letters to the Centers for Medicare & Medicaid Services (CMS), America’s Essential Hospitals commented on the calendar year (CY) 2021 Outpatient Prospective Payment System (OPPS) and Physician Fee Schedule (PFS) proposed rules.

Proposed rules for OPPS and PFS would deepen Medicare Part B drug payment cuts to hospitals in the 340B Drug Pricing Program, continue site-neutral payment policies, revise the overall hospital star rating methodology, and add to the list of reimbursable telehealth services. The association urged the agency to reverse policies that will result in significant funding cuts to essential hospitals and hinder access to care.

OPPS Comments

As proposed, the OPPS rule would continue to phase in site-neutral payment cuts to hospital provider-based departments (PBDs) and reduce Medicare Part B reimbursement for drugs purchased through the 340B Drug Pricing Program. Additionally, the rule would remove procedures from the inpatient-only (IPO) list as part of a three-year plan to phase out the list completely, and add two categories to the list of services requiring prior authorization. The rule also includes updates to the overall hospital quality star ratings methodology.

Based on these provisions, the association made several comments on the OPPS rule and urged CMS to:

  • pay hospitals in the 340B program the statutory default payment of average sales price (ASP) plus 6 percent;
  • not reduce payments for separately payable drugs purchased through the 340B program and administered at non-excepted PBDs, as doing so exceeds the agency’s statutory authority under the SSA;
  • withdraw its cut to excepted, off-campus PBDs, for which it lacks authority and which clearly contradicts congressional intent in passing section 603 of the BBA, and revert to paying excepted PBDs the full OPPS rate for clinic visits;
  • pay non-excepted PBDs of essential hospitals at a rate no lower than 75 percent of the OPPS rate, as opposed to the 40 percent CMS pays;
  • address stakeholder concerns about eliminating the IPO list, including burden on providers, time frame for removal, and impact on patient-mix for Medicare models; and
  • refine the overall hospital quality star ratings by eliminating the complex latent variable model, applying stratification in the readmissions measure group, and using peer grouping to better compare hospitals.

PFS Comments

Meanwhile, the PFS proposed rule touches on several different topics, such as adding telehealth services that qualify for Medicare reimbursement; adjusting bundled payment rates for treatment of opioid use disorder (OUD); making year five updates to the Quality Payment Program (QPP), including delaying implementation of the Merit-based Incentive Payment System (MIPS) Value Pathways (MVPs); and proposing other quality changes to the QPP and Medicare Shared Savings Program (MSSP). Further, the proposed rule introduces several payment and coding changes for physician services and makes scope-of-practice changes regarding physician supervision and supervision of medical students.

In response to proposals, the association made comments on the PFS rule urging CMS to:

  • account for essential hospital challenges and preserve adequate reimbursement rates for essential hospitals’ excepted and non-excepted PBDs;
  • expand vulnerable populations’ access to lifesaving services by broadening the scope of telehealth reimbursement and lifting barriers to Medicare reimbursement for these services;
  • continue to refine the methodology and measure set used to establish accountable care organization (ACO) quality performance under the MSSP, delay implementation of the new alternative payment model performance pathway (APP) for MSSP ACOs, and retain the pay-for-reporting year for ACOs;
  • refine the QPP by delaying implementation of the new MVPs until at least 2022, double from five to ten the complex patient bonus in MIPS, and seek further input from stakeholders before implementing the new APP;
  • finalize policies that reduce burden on clinicians in the promoting interoperability (PI) category of the MIPS and provide flexibility as providers transition to more difficult PI category requirements.
  • provide at least a one year to transition away from the Web Interface reporting option in the MSSP and QPP to give providers time to assess alternatives and implement a new reporting method;
  • continue allowing practitioner supervision requirements to be met using audio-video communications technology; and
  • expand the definition of OUD treatment services to include naloxone and overdose education, and adjust bundled payment rates accordingly for OUD treatment services furnished by opioid treatment programs.

Contact Senior Director of Policy Erin O’Malley at or 202.585.0127 with questions.


About the Author

Abigail Painchaud is a policy associate at America's Essential Hospitals.

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